The experts of the Financial Monitoring Group of the Central Reform Office under MinRegion monitored the growth rates of the budget own revenues, namely those of AHs, and provided expert opinions.

During 2017, the revenues to the general fund of local budgets of Ukraine (excluding interbudgetary transfers) amounted to UAH 192.7 billion, which is by UAH 46 billion or 31.4% more than in 2016.

Yanina Kazyuk, financial decentralisation coordinator of the Central Reform Office under MinRegion, said that taking into account the processes of hromadas’ amalgamation during 2015-2016, their revenue base has considerably expanded. The indicator of revenue surplus in the budgets of 366 AHs was +87% (almost 1.9 times more), compared with 2016. The total amount of revenues to the budgets of 366 AHs amounted to UAH 9.3 billion. Of this amount, the budgets of 159 AHs formed in 2015 reached UAH 4.4 billion, while the budgets of 207 AHs formed in 2016 received UAH 4.9 billion.

She detailed analysis of the growth rates of own revenues to local budgets:

• in total, local budget revenues grew in Ukraine by +31.4%;
• budgets of cities of oblast significance – by +31%;
• budgets of 159 AHs (where the first local elections were held in 2015, and where they were receiving the PIT income in 2016 and 2017, that is, there is a comparative base), the surplus was +34.2%, which is more than the average indicator in Ukraine and in cities of oblast significance.

It is important to note that 107 out of 159 AHs (or 67% of the total amount) have achieved an increase in their own revenues that exceed the country’s average one.

It should be mentioned that among those 107 AHs that have a surplus in revenues higher than the country’s average one, the largest share – 67.3% – belongs to the budgets with the population of over 5 thousand residents.

And out of 52 AHs that have a lower percentage surplus than the average in Ukraine – there are 22 AHs with a population of up to 5 thousand residents (and this makes up 42%).

Consequently, hromadas with a population of more than 5-7 thousand residents have more potential to increase their revenue base and more opportunities for proper maintenance of infrastructure, functioning and communal ownership institutions, and local self-government bodies can provide high-quality public and communal services.

Materials are prepared by the Financial Monitoring Group of the Central Reform Office under MinRegion (with the support of the U-LEAD with Europe Programme and the SKL International project):

• Yanina Kazyuk, financial decentralisation coordinator
• Viktor Ventsel, financial monitoring expert
• Ihor Herasymenko, financial monitoring expert

The full version is available in Ukrainian – please click HERE